In the News (from The Wall Street Journal Blog): “The world needs to create about 200 million jobs to reach full employment.
“That’s one finding from a new report released Friday by the International Labor Organization and the World Bank. The two groups, based on a request from the Group of 20 advanced and developing economies, are unveiling a database that tallies policy responses to the financial crisis and global economic downturn. …
“The employment tally found that the world lost 27 million jobs between 2007 and the height of the crisis in 2009. But labor force growth adds about 40 million people to the global labor market each year, and overall economic growth—even before the crisis—hadn’t been strong enough to absorb them. That created a long-run jobs gap of 177 million, on top of the 27 million jobs lost in the downturn. …
“The impact of the crisis on employment has been deep, and with no appreciable recovery, particularly in the developed countries. Table 2 shows that between 2007 and 2009—at the height of the crisis—an estimated 27 million jobs were lost globally. Half of these jobs were lost in the advanced economies, five million in East Asia, three million in Latin America and the Caribbean, and one million in South Asia. …
“The rate of youth unemployment rose globally from 11.7 percent in 2007 to 12.8 percent in 2009, the advanced economies being hit particularly hard, where this rate jumped from 12.5 percent to 17.3 percent over this period.” Source: ILO/World Bank
“While the world experienced ‘an unprecedented widespread policy response to the crisis,’ the report says, ‘policy responses led to a recovery in GDP growth but not a significant increase in jobs.’
“Among the study’s other findings:
–Policies of high-income countries focused on access to credit, while low- and middle-income nations prioritized direct job creation and employment incentives.
–About 55% of high-income countries used unconventional monetary policy vs. 33% of low- and middle-income countries.
–About 86% of high-income countries in the sample used a fiscal stimulus, while 84% of low- and middle-income countries did so.”
My Comment: The solution is to restructure the whole system of a society based on growing consumption. If our system of consumption were really unlimited, then there would have been no end to “America.” But since we exist in a limited, finite system of society, resources, and environmental limits, the “pyramid” must fall apart. See the post “The Pyramid Economy.”